The Various Asset Protection Strategies:
Imagine you’re out in the middle of the ocean, and your boat starts sinking. The seas are rough, the waves are crashing, and you’re faced with a choice: grab a pair of child-sized floaties, strap on a life vest, or climb into a sturdy lifeboat.
It’s a no-brainer, right? The floaties might keep you afloat in calm waters, but they’re useless in a storm. A life vest gives you a bit more security, but it’s no match for relentless waves. In rough seas, the lifeboat is your only real option.
When it comes to protecting your assets, this same analogy applies. Floaties, life vests, and lifeboats represent the layers of asset protection strategies: LLCs, Limited Partnerships, and the Bridge Trust®. Let’s break down how each works and why the lifeboat is critical when the financial seas get rough.
1. Floaties (LLCs): Basic Protection for Calm Waters
LLCs are like child-sized floaties. They offer basic protection, creating a legal barrier between your personal assets and business liabilities.
When Floaties Work:
• Operating a small business with minimal risk
• Protecting one or two assets (e.g., rental properties)
• Facing low levels of liability exposure
But just like floaties won’t save you when your boat is sinking, LLCs won’t protect your assets in the face of serious legal threats. They’re useful in calm waters, but they’re not built for storms.
2. Life Vests (Limited Partnerships): Intermediate Protection for Rougher Waters
Limited Partnerships are the equivalent of a life vest. They provide more robust protection than floaties, offering an added layer of security by separating ownership and liability across different entities.
When Life Vests Work:
• Diversifying risk across multiple assets or investments
• Protecting passive income streams (e.g., real estate portfolios)
• Managing partnerships with shared ownership
A life vest keeps you afloat longer than floaties, but it’s still not ideal when waves are crashing over you. For serious risks—like lawsuits or aggressive creditors—you need more than a life vest.
3. Lifeboat (The Bridge Trust®): Maximum Protection for Open Oceans
The Bridge Trust® is your lifeboat. When the seas are rough, the winds are howling, and your financial ship is going down, the Bridge Trust is what ensures your survival.
Why the Bridge Trust® is Your Lifeboat:
• Offshore Strength: It is a fully registered offshore cook island trust from the first day that it is created, and it transitions seamlessly from a domesticated trust to an offshore trust, creating an impenetrable barrier against lawsuits and creditors.
• Comprehensive Protection: It shields your wealth from major financial predators, giving you peace of mind even in the roughest legal and financial storms.
• Tax Neutrality: Fully compliant with tax laws, it won’t attract unwanted scrutiny from the IRS.
When your financial ship is sinking, the Bridge Trust doesn’t just keep you afloat—it ensures you’re protected and secure.
When to Use Each Layer
• Floaties (LLCs): Perfect for low-risk situations or small businesses, or you are just starting out with your first investment property.
• Life Vests (Limited Partnerships): Ideal for moderate risk, such as managing multiple assets or investments, possibly investing in multiple states.
• Lifeboat (Bridge Trust®): Essential for high-stakes scenarios, protecting generational wealth, high-risk professionals (doctors, dentists, lawyers, CPAs, entrepreneur, …) and safeguarding against aggressive lawsuits and creditors.
The Importance of Layering
Just as you wouldn’t rely on floaties or a life vest in a storm, you shouldn’t rely on a single layer of asset protection when your financial ship is sinking. Layering strategies—starting with LLCs, adding Limited Partnerships, and ultimately incorporating the Bridge Trust—creates a comprehensive system that adapts to the level of risk you face.
Ready to Climb into Your Lifeboat?
When the seas are rough and the stakes are high, you need more than floaties or a life vest. You need a lifeboat that can withstand the storm.
Schedule a legal consultation with our asset protection lawyers today at (888) 773-9399
Let us help you design a plan that ensures your assets stay secure no matter what challenges come your way.
Because when your financial ship is sinking, the right protection isn’t a luxury—it’s a necessity.
By: Brian T. Bradley, Esq.
